[14:05] {Threei} - participants again discussed the merits of including agency MBS backed by adjustable-rate mortgages (ARMs) in the Committee's MBS purchase program: Some thought it would be useful to include agency ARM MBS, noting that doing so could reduce the unusually large spreads between ARM rates and yields on similar-duration Treasury securities--spreads that were far larger than the comparable spreads on fixed-rate mortgages; others saw little potential benefit, given the small stock and limited issuance of ARM MBS, and were hesitant to involve the Federal Reserve in another market segment.

[14:06] {Threei} - Saw contraction in disutryial production as slowing in Q2

[14:06] {Threei} - Overall economic activity 'stabilizing'

[14:06] {Threei} - several participants noted that banks still faced a sizable risk of additional credit losses and that many small and medium-sized banks were vulnerable to deteriorating performance of commercial real estate loans.

[14:06] {Threei} Participants again observed that obtaining or renewing financing for commercial real estate properties and projects was extremely difficult amid worsening fundamentals in that sector, though some noted anecdotal evidence that the addition of highly rated commercial MBS to the list of securities that can be pledged as collateral for TALF loans had contributed to an improvement in liquidity in that market.

[14:09] {ese} yaaaaaaaawwwn.............smifgavortahhheemm..........

[14:09] {nemo} somebody tuck ese in

[14:10] {ese} was dreaming that i was scalp trading.........wait........i am yaaaaawwwwwn

[14:11] {Threei} if scalping makes one yawn, I am scared even to think what makes one jump